September 18, 2020

Bush replies to Cayman Islands Budget Debate

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This is the complete and unabridged Reply To Budget Motion Debate by The Honourable McKeeva Bush, OBE, JP  Premier and Minister of Finance Tourism and Development 28 June 2012, as sent to us by the Office of the Premier.

The Temporary Opportunity for Permanent Change

I am compelled to inform the house of our Government’s plans to introduce a temporary budget for the current period.

It is not something we wished to do, indeed, had we not been put in the position by the previous PPM administration of 2005-2009 of going cap in hand to London each time we now produce our own budget this would not have been necessary.

Every new government hopes to be handed a fish when they take over. What the PPM handed us was a snake. We asked for bread, and they gave us a stone – and not any ordinary stone – a millstone around our necks; a massive debt, and an $81 million dollar deficit when we took office, along with the huge ongoing cost burden of the unfinished schools and other over-ambitious projects. The results from our hard work over the last three years, the turn-around we’ve accomplished, should have been enough, with a temporary overdraft facility, to tide us over until the higher revenue period at the end of this year.

But, no, that option was blocked, because we had been put, for the first time in the history of these Cayman Islands, outside of the agreed ratios, by the PPM’s excessive and wasteful spending, and by their refusal to pay any attention to the country’s balance sheet. So now, we must not only find ways to repair our finances, and protect our independence and the future of our islands, we must also do this while being subject to the agenda of the UK, which is NOT based on the development urgencies of the Cayman Islands, as their prime goal.

Madam Speaker, it is bad enough that they left the country in such a sorry state, where our very way of life is threatened and the future of our children is mortgaged, where we are under constant pressure to abandon the very principles that helped us become an international success; I mean, pressured to start taxing our people, and thus drive away the finance industry which is the backbone of our economy.

For this alone they should hang their heads in shame; and instead of walking out of this Assembly – as if they occupied some moral high ground, they should be tarred and feathered for gross mismanagement in high office. On top of all this, over the last three years, years critical to our future and very survival, they have, instead of pitching in to help bail the boat, and offer what help and suggestions they could, they have chosen to take every opportunity, have even created new opportunities, to obstruct and oppose every positive measure this government has brought forward.

They have worked, much harder than when they were in Government, to turn the debates to as poisonous a pitch possible, to pit every man against his brother, to besmirch and blacken these Islands’ name locally and internationally, so that if people outside were really to listen to that crew, no one would consider coming to visit or invest here. And they have people who help them, and call it good reporting.

They seek to turn these islands, whose prosperity was founded on leading the world in new and open ways to do business, into a place where everything must be opposed for opposition’s sake, regardless of whether it is needed, or helpful.

Yes Madam Speaker; they oppose everything, then moan and whine all day, about why things aren’t improving, complain about the lack of jobs and growth, then go out and march against the very investments and projects that can create them.

So mired is the opposition in their own bitter selfishness and jealousy, they would rather pull these islands down, than see someone else make them succeed.

At these critical times, when we need all hands on deck, they choose to make a mockery of the very government they aspire to lead. While Rome burned Nero fiddled; while Cayman struggles, they stand outside under a tree, holding a mock parliament and spouting false and inflammatory ideas.

In the first few months of this government, the Leader of the Opposition said he would start a campaign never before seen in this Island – and he has held true to his word. But what has gone on here in terms of opposition politics, can’t continue if the country is to remain stable. So Madam Speaker, I can tell these Islands – that if I have the opportunity to lead another government – it will be one where every member of the House will sit around the table in the Government Administration Building and have a hand in the policies and the things that need to be done in these Islands. This will be an attempt – while there will remain a Cabinet – to stop the dirt, underhandedness and outright sabotage going on against the government. This Country will not long withstand the kind of opposition politics carried out this past three years, and I suspect will continue to be carried out, until the people choose again.

Madam Speaker, I have always believed that in a small place – the committee system works well, and I will aim to put that in place should I choose to run – and if I win – in the next General Election. Every MLA will then have to accept their share of accountability, no matter their party affiliation.

But we will not, and have not, been put off by their childish crab-in-a-barrel antics. These are serious times, and we have been looking forward to how we can, not just survive these times, but find a way through to put Cayman back on course for prosperity; now, and for Generations to come. That means prosperity not on the old model of growth, but growth that supports sustainable development.

This requires clear thinking, discipline, hard work and the embrace of reality – both its challenges and its opportunities. It requires us to bring people together, to collectively create a future we can ALL be proud of.

That said, Madam Speaker, we therefore remain of the view that even though we are forced to present a Temporary or interim budget, we have an opportunity for Permanent change.

We believe that this unprecedented event will be the turning point that allows people to see the seriousness of what needs to be done, to accept, as we have, that we can NOT carry on down the PPM path – a path where you just spend and spend, and borrow and borrow, and hope someone, from somewhere, will show up and pay off your debts; a path where you give up control of your country, whether to London, to the World Bank, the IMF, or whomever. Neither can we fail to address the challenge of determining a sustainable development agenda. That is how we sail our ship. We know our destination, and we set course for it.

This could be a turning point at which people will embrace, with us, the goal of taking back control of our finances and our fate.

The hard news is that, as part of getting our house in order, we will have in the short term, to make more cuts in our expenditures. We have already announced a freeze on all hiring, even for those who have offers in place. It’s not something we wanted to do but, like every householder knows, when your revenue shrinks so must your expenses, even more so when you have a huge debt to pay off.

There will be more cuts, but we are working to do them in a careful and thoughtful manner. This is one of the opportunities the temporary budget provides us, to work through things in the right way, always with an eye on the long-term impact on our people.

But it’s not just about cuts, and it’s not like we have just now come to grips with these issues. We have been working non-stop since we took office, to repair the mess we inherited, and we have made great strides.

Madam Speaker, I hear the opposition say, it is time to stop blaming – but I have to disappoint them – I can’t and I won’t. The reality must be faced – you can’t spend so much that there is a $81 million deficit and three buildings at $100 million each, plus roads and other buildings and sundries which the government must borrow to pay for, where there were 1072 new staff in four years (2005-2009) which were brought in despite declining revenue; you can’t do all these things, and expect that it will not create the kind of financial crisis that has resulted. If you create debt or cost of $300 million, and you pay down $200 million, you are still left with $100 million to pay. So, the Opposition will keep saying we must stop talking about 2005-2009, their term in office, but their record is not just going to go away; it is what has caused the current problems, and why the UK controls our budget today.

Despite the constant noise and attempts at delay from those who oppose everything, we have, in the midst of the worst global financial crisis since the 1930s, brought investment and opportunity to these Islands, and these provide significant planks for our survival and recovery.

This is the type of investment that impacts our people the way they need it most, with jobs for those out of work, and business for companies that are struggling. Along with being the first administration to progress the new port and protect our cruise tourism sector, it is intended that value for money and business case studies will be conducted. While China Harbour would do the actual piers, we have also ensured that local companies and contractors here at home such as DECCO, McAlpine and Hurlstone  will be joining with them to develop the upland section – that is, all the new buildings. This brings new investment, jobs, government revenue and also keeps as much as possible here at home.

I am happy to announce that we continue to progress on the project to develop these purpose-built world-class cruise berthing facilities. As I’ve previously indicated, there are two major parts to this project – the docking and passenger landing facilities, and the uplands commercial operations. We are working through in detail, the design, finance, engineering, construction, maintenance and operations elements. The primary benchmarks guiding these discussions include feasibility, local participation, and ultimately, the achievement of value for money in the project delivery. We are determined to get the best deal for Cayman, and to secure best value for money. We will not shirk from full examination of what we are doing, by the Central Tenders Committee (CTC), the Auditor General, and any other duly empowered regulatory authority. To ensure effective management and timely delivery in this project, we have employed a highly experienced local Project Manager.

At a time when the entire region (and beyond) is crying out for investment for development, and showering potential investors with offers of concessions and support; we have been able to reach an agreement with the Dart group, a fair and profitable agreement for the people of the Cayman Islands, that will see the Esterly Tibbets highway extended and part of it moved to create the opportunity for new development and hotels to begin.

This agreement, with the ForCayman Investment Alliance, has already brought in millions of dollars to Government coffers and will bring tens of millions more.

The agreement also provides for an additional 20 acres to come to Government, part of which will be for a new cemetery in West Bay and part of the beach at the former Victoria House site, will become public. In addition to enlarging public beach and moving our children who play there farther from a busy road, we are expanding the public’s access to more public beach space. The Government has also agreed for Dart to build a new Sunrise Centre school – in the vicinity of Camana Bay near the round-a-bout on the side of the new National Gallery nearest to West Bay.

Some foolish people decry working with the largest and most generous resident group in the Cayman Islands, a group who has shown their commitment to support and invest in these islands and its people. The group who opposes us – has neither used common sense, nor any other kind of rationale; because they are led by people who, in the back of all their clack and noise, is an effort to unseat me, and get a seat for themselves. They have told every lie possible about the projects; saying that we were selling the public beach, and the public wouldn’t be able to use it; doing their best to try to tear me down.

Where do they think the investment and jobs are going to come from, for the 3-400 children coming out of school each year? Who else is willing and ready, in these times, to invest hundreds of millions of dollars to create new offices, new hotels, new shops and activities and maintain a long-term commitment to the Cayman Islands?

We need to do the right thing and, with prudence and care, both of which we have shown amply. We have to make the right deals so that both the Cayman Islands and our investors can succeed and prosper together. And they can’t say that I don’t work; thy try to put blame on me about travelling – but business has been created, and enhanced because I went out and pushed for it. But you can’t in this country think any more that you can start from scratch – because that is what I had to do – there were no prizes left by the PPM. People want to invest, but with the kind of bureaucracy in this country, new blocks don’t go in the ground overnight.

And with the Governor hollering about ‘good governance’; his hit men in the Audit Office carrying on their partiality and rascality, and Alden and the PPM constantly in the press putting down investors; Ezzard and his porn show – what else would we get but a slowed economy? Nobody wants to put money quickly in a country that has that kind of rot to deal with.

As an example, I’ve already mentioned that part of the recent road agreement also calls for the construction, at no cost to Government, of a new Sunrise School. We have also already seen work on renovating the old Courtyard Marriott, closed during the last administration. These are the types of investment that create jobs – create jobs Now, bring business activity Now, bring new revenue now, and this is what our people need.

We are also looking at other creative and progressive ways to raise revenue and improve our competitiveness.

Although these times force us to increase fees, like those on liquor licenses which I announced Monday night, we are focusing this new revenue / it will be earmarked for the ‘Hospitality Training School’ so that our people can have the right professional training, to take up the jobs our other policies are creating. People are paying good money for them and their families to enjoy a vacation – of course they want professional service – service that is professional and pleasant; that is hospitable – and that is what the new school would be achieving – Professional Hospitality Training. We are good at hospitality, and hospitality is good for us. That is why we are investing in it.

To grow our tourism sector and improve our competitiveness we are going to be the administration that finally gets the airport expanded. In the meantime, another new initiative that I want to announce today, Madam Speaker, is the imminent elimination of outgoing immigration, to both improve the experience for our tourism guests, and our own people travelling, and also save some of our costs.

Using this temporary budget as the fulcrum, we are leading these Cayman Islands, away from its profligate and divisive immediate past, and back towards the principles that made it great in the first place – hard work, thriftiness, progressive legislation and an inclusiveness that welcomes the best from all over the world to come and bring their talents and their investment dollars, to a place where they are welcomed and encouraged to succeed, and to contribute.

We are on the path to restore our balance sheet so that we can reclaim our historical right to decide on our own budgets and our own direction.

Both in the measures already mentioned, and also through working to improve our balance sheet, we are intelligently making arrangements to divest where appropriate and also to receive more where and when it makes sense; always looking towards getting our finances back where they should be, and where they were when we last left office.

It will not be easy – but life is not easy for most now anyway; yet we can, and will get there, we will lead the Cayman Islands back to solid financial ground. We will get back to a place where every able Caymanian who wants and needs a job can have one, where we can invest in our future and the future of our children, secure that it will be a future decided by Caymanians, and not by officials elsewhere. This will be a future where we provide the services, protection and opportunities to our people that they need, and do so through growth, sustainable growth, across all sectors of our economy.

Those truly interested will understand, that this must mean progressively overhauling our existing growth model. The Cayman Islands has the right stuff to become a world leader in sustainable development. Our local industry partners have to be brought to the table on that agenda. Our discourse with the UK must become a development agenda; that is the right way around, that is the basis on which we should budget – not just cutting budgets to meet formulas.

We have done and will continue to do what is necessary to secure that sustainable future for all of us, we have the energy, ideas and courage to do so, and we will not be discouraged, we will not give up, we will not be halted. What must be done is too important, for too many people.

Opportunity also presents itself in the form of initiatives by those who believe in what the Cayman Islands has to offer. For instance, I am aware of a soon to be revealed, signature destination golf resort and residential community that is to be built in East End. This development will have a complete town centre that features retail shops including grocery and hardware stores, a movie theater, restaurants and entertainment.

This development will provide the convenience and catalyst that the eastern half of our Islands has long needed. There are residents along the 28 miles of coastline from Bodden Town to Cayman Kai that go west to shop, play and work. This $300 million direct investment will provide an alternative location for work and business opportunities, entertainment and convenience shopping. Unlike many other large projects this developer is seeking no credits, import duty waivers, or delayed government fees. I think I can agree, this direct investment will not only provide intrinsic value to land owners in our eastern districts, but will also provide a significant projected boost of more than $40 million to government coffers over the next 6 years.

So what is today – its – the temporary opportunity, for permanent change.

I have said why this is so, on the basis that if we call this a budget crisis, it does present the characteristics of a crisis – both dangers, and opportunities. I would argue that the greatest danger is that we do not recognize, and seize those opportunities – that is, to do a real overhaul, not just of our budget, but the basis on which we budget – to foster sustainable development.

So again I say what is today? It is the temporary opportunity, for permanent change.

END

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